Call it back-alley government: full of cans kicked, with no one bothering to take responsibility to clean it up. To borrow a metaphor from criminology, if the neighborhood shows signs of decay, if no one takes pride in its upkeep, then behavior will adjust accordingly. Republicans certainly hate government and say that it doesn't work, and then (as P.J. O'Rourke says), "they get elected and prove it." Democrats miscalculated during the debate over the parameters of the sequester, and everyone took the bait. It turns out that Republicans are unmoved by major defense cuts. Or, at least, the Republicans elected to office in the districts that crackle with political energy are not rallying around "national strength" as a motivating idea, except of course when President Obama does something that requires them to manufacture discontent. The traditional levers of influence used to keep parties in check and in a mood to govern are simply gone. They've been replaced on the right by the Perpetual Revanchism Machine, which takes in whatever is happening and spits out its direct opposite. (Suddenly, neoconservatives are out; isolationists are in.)
And what about the White House? Utter communication confusion. White House advisers are bitching out the press like never before, with Ron Fournier, of all people, terminating a long-standing conversational relationship because of one too many F-words. (Want to know who his source was? Look at the White House org chart and do some Googling. I have known everyone who speaks to the press since well before the Obama campaign ever went afloat, and some of them have simply lost their capacity to get over themselves. Others match the cynicism of their boss.) Obama is belatedly attempting to meet with Senate Republicans because he wants to use the stasis to push the government towards a Grand Bargain. This is a mildly positive step akin to polishing up a window in that back alley; it shows some pride in governing; some optimism; some faith in the idea that gestures matter.
Politico says Obama can't get any more revenue from Republicans because he played his hand too early, winning $600 billion in new revenue in December at the cost of entrenching Republican revanchism in the House. Republicans won't agree to any more tax cuts. There is no penalty for them to compromise anymore. Their donors don't seem to care, or their financiers aren't influential to the degree that they once were. There is a delay between the implementation of the sequester and whatever pain it might cause. Time attenuates the blame that Republicans will get. House GOPers are either in safe seats or seats where playing their opposition to the hilt will turn out conservatives, enough for them to win. Wall Street doesn't care, so long as the larger markets of financial (as opposed to) economic health are sound.
That both Democrats and Republicans in the Senate have a budget is a sign of stasis fatigue, but there is no middle ground. Obama's budget, to be released in April, is likely to a set a marker on entitlements that his own party will reject out of hand.
The back alley can be swept up and the cans thrown away if one side breaks down and decides to martyr itself. Democratic activists will find this unfair because of recent election results and the shape of previous compromises, but I think the chances that Obama steps up, at some risk, and agrees to entitlement cuts, and spending cuts in exchange for a very short term stimulus (to mitigate the effects of the sequester) and long-term tax reform is more likely than Republicans agreeing to anything. Unfair, yes. But then again, only one party is really governing now. In the short term, Obama might be well to accept the Republican effort to let him reorient the sequester's effects. He might well get from them some temporary revenue enhancers, even; he'll have to do so over the objections of House Democrats and the intellectuals that are writing the party's history from their blogs and in their newspaper columns.